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We recently addressed the buzz around prediction markets in the July-August 2026 issue of The Corporate Counsel, which is on store shelves now – just kidding, you can only get access to The Corporate Counsel newsletter by emailing us at info@ccrcorp.com or calling us at 800-737-1271!

In writing the article about prediction markets, I learned quite a bit that I did not know about this rapidly evolving area. Here my top five highlights:

1. Prediction markets are nothing new. Beyond the obvious fact that futures and forward contracts have been fueling speculative bubbles for ages, the modern concept of prediction markets dates back to the late 1980s in the U.S., when I was busy wearing paisley shirts and listening to The Cure in college. I wish I could have entered into an event contract back then predicting that The Cure’s frontman Robert Smith would do a collaboration with Olivia Rodrigo in 2026 – I could be retired at this point. Even if I can’t be retired, I can still very much enjoy that epic collaboration!

2. The CFTC is in the midst of actively updating its rulebook for prediction markets in light of the growth and popularity of these markets in recent years. As I mentioned a few weeks back, the solo CFTC Chairman is acting with a one-man-band level of proficiency, seeking comment on a wide range of issues concerning the regulation of the event contracts that are traded on prediction markets, issuing a Staff advisory directed at the Designated Contract Markets where the event contracts are traded, and proposing rules in June that specifically address the types of event contracts that can be listed on CFTC-registered prediction markets.

3. While the CFTC is reviewing its regulatory purview and working to update its rules, the states are fighting for their piece of the regulatory pie. Last month, 44 state attorneys general submitted a comment letter to the CFTC arguing that the agency does not have any authority over sports-related event contracts. The attorneys general representing Florida, Georgia, New Hampshire, Missouri and Texas did not sign that letter.

4. Prediction markets obviously also operate internationally, and so they face a myriad of regulatory approaches outside of the U.S. Some prediction markets only operate outside of the U.S. so as to avoid CFTC or state oversight. Surprisingly, even though we have had prediction markets operating in the U.S. for over thirty years, in many ways it feels like we are still in the early stages of development when it comes to the regulation of prediction markets. It will be very interesting to see how this all unfolds.

5. The problem of information asymmetry is a big concern in prediction markets. Earlier this year, the CFTC’s Division of Enforcement issued an advisory following the release of two enforcement cases involving the misuse of nonpublic information and fraud with respect to certain event contracts, warning Designated Contract Markets to be vigilant in their surveillance and enforcement of rules addressing these areas. As I note in the article, the potential insider trading complications of prediction markets have recently come to the attention of public company general counsels and outside counsel as they now have had to grapple with the ever-present problem of rampant information asymmetry in the markets. Overall, I think that companies need to pay attention to this issue and revise the appropriate policies accordingly, but perhaps there is a greater need to educate employees about the risks of using inside information when engaging in prediction market transactions.

I encourage you to read the full article, “Prediction Markets: What Should Companies Do Now?” in the July-August 2026 issue of The Corporate Counsel newsletter. Please feel free to reach out to me if you have any questions!

– Dave Lynn